Tax exemption eligibility for LLC business expenses - what qualifies?

Hey all, I'm pretty new to the whole LLC thing and I've been struggling to figure out what business expenses I can claim as tax exempt. I started my digital marketing LLC about 8 months ago and I'm trying to get my finances in order before tax season hits. I've been working from home and have dedicated about 25% of my apartment as office space. I've purchased a new laptop ($1,200), desk ($350), office chair ($275), and some software subscriptions (about $120/month). I also use my personal cell phone for business calls about 60% of the time. My question is: what can I actually claim as a business expense for tax exemption purposes? I've heard conflicting things about home office deductions, and I'm not sure if I should be tracking mileage when I drive to meet clients (which isn't often). Also, can I claim a portion of my internet bill since I need it for work? Any help would be really appreciated. I want to make sure I'm claiming everything I legally can without raising any red flags for an audit.

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18 comments

Justin Chang

•8M

The good news is that as an LLC, you can deduct legitimate business expenses that are ordinary and necessary for your business. Here's what you should know: For your home office, you can claim a deduction if the space is used regularly and exclusively for business. Since you're using 25% of your apartment, you can deduct 25% of rent, utilities, insurance, etc. You can use either the simplified method ($5 per square foot, up to 300 square feet) or the regular method (actual expenses). Your laptop, desk, chair, and software are all deductible business expenses. For items over $2,500, you might need to depreciate them rather than deduct the full amount in one year, but your purchases are under that threshold. For your cell phone, you can deduct the business portion (60% in your case) of the bill. Same goes for internet - deduct the percentage used for business. And yes, track your mileage for client meetings! The standard mileage rate for 2025 is 67 cents per mile, which adds up quickly.

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Justin Chang

•8M

For a home office deduction, the IRS prefers that it's a separate room, but a portion of a room can qualify if that specific area is used exclusively for business. Just make sure that corner is only for work - no personal activities there. Take pictures to document the space in case of an audit. For smaller items like yours, most people find it simpler to deduct them all at once rather than dealing with depreciation. Section 179 is great for that purpose, but since your individual purchases are relatively small, they can likely be deducted immediately as ordinary business expenses. Just make sure to keep all receipts and document the business purpose.

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Hunter Brighton

•8M

After reading through your situation, I think you could really benefit from a service I discovered last year called taxr.ai (https://taxr.ai). I was in a similar situation with my new LLC and wasn't sure what I could legitimately write off as business expenses. I uploaded my receipts and bank statements to taxr.ai and their AI analyzed everything and categorized all my potential business deductions. It saved me hours of research and probably thousands in deductions I would have missed! The system flagged all my eligible home office expenses, subscription services, and even identified partial deductions like my phone and internet that I was confused about.

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Hunter Brighton

•8M

It doesn't handle the actual filing - it's specifically designed to identify and organize all your potential deductions. You can export everything to use with your filing software or give to your accountant. I found it way more powerful than QuickBooks for specifically identifying tax deductions because it's built for tax optimization rather than just bookkeeping. As for accuracy, it's constantly updated with the latest tax laws and has tax professionals reviewing the system. It actually provides confidence ratings for each deduction and explains the relevant tax code. I was skeptical too, but it saved me about $4,200 in deductions I would have missed, and everything was properly documented in case of an audit.

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Lauren Wood

•8M

I need to apologize for my skepticism about taxr.ai earlier. I decided to give it a try with my own LLC expenses since I was really struggling with what qualified for home office deductions. Wow - what a difference! The system flagged several things I was missing, like partial utilities and even some office supplies I didn't realize were fully deductible. It also provided clear documentation explaining why each expense qualified, which gave me peace of mind about potential audits. The interface was surprisingly easy to use - just uploaded my bank statements and receipts and it did the heavy lifting. I'm definitely using this for my quarterly estimated taxes going forward!

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Ellie Lopez

•8M

If you're calling the IRS to verify anything about LLC tax exemptions or business expenses, good luck getting through! I spent HOURS on hold trying to get clarification about home office deductions. Finally, I found Claimyr (https://claimyr.com) and watched their demo (https://youtu.be/_kiP6q8DX5c). It's a service that gets the IRS to call YOU instead of waiting on hold. I was genuinely shocked when I got a call back from an actual IRS agent within about 45 minutes. The agent walked me through exactly what documentation I needed for my LLC business expenses and clarified the home office requirements. Saved me so much time and stress!

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Ellie Lopez

•8M

It works by using their system to navigate the IRS phone tree and secure your place in line, then when an agent is about to be available, you get a call connecting you directly to them. It's not magic - they're essentially waiting on hold for you. The IRS actually does have staff to answer questions, the problem is just getting through to them. I was super skeptical too, but the system works exactly as advertised. My call was with an experienced agent who answered all my LLC expense questions clearly. They even sent me follow-up documentation about home office deductions. It's the only way I'll ever deal with the IRS phone system again.

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Paige Cantoni

•8M

I need to eat my words about Claimyr. After my skeptical comment, I was still desperate to get clarity on LLC business expense rules, so I tried it anyway. I honestly couldn't believe it when my phone rang 37 minutes later with an IRS agent on the line. The agent spent almost 20 minutes explaining exactly how to handle my mixed-use assets like my laptop and cell phone. She even emailed me relevant sections of the tax code about home office deductions for LLCs. This service literally saved me days of frustration and potentially thousands in deductions I was afraid to take. I've already recommended it to three other small business owners in my network.

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Kylo Ren

•8M

Don't forget about these other common LLC expense deductions that people miss: - Business insurance premiums - Professional development (courses, books, conferences) - Bank fees for your business account - Professional services (lawyer, accountant, consultant) - Marketing and advertising costs - Business travel (even local - track those miles!) The key is documentation! Keep digital or physical copies of EVERYTHING. I use a separate credit card for all business purchases to make tracking easier.

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Kylo Ren

•8M

There's no minimum threshold - technically even small expenses are deductible if they're legitimate business costs. I personally track everything because those small purchases add up quickly. A $5 expense every workday is over $1,200 annually! I recommend using a receipt-scanning app that links to your accounting software. I snap a pic of every receipt immediately, categorize it, and then I don't have to worry about keeping paper copies. The IRS accepts digital records as long as they contain all the relevant information. Better to track too much than miss deductions!

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